the examination of county records for the property's title history by a title company,
an abstractor, attorney or escrow officer to determine the "chain of title" and
the current status of title, including owner, legal description, easements, property
taxes due, encumbrances (mortgages or deeds of trust), long-term leases, judgments
or other liens. When a title search is completed, a "preliminary report" on title
will be issued by the searcher. On the recording date of any new transfer or encumbrance
(such as a new secured loan), an updated "final title report" will be issued which
will make it possible to obtain title insurance guaranteeing against any problems
with the title. Sometimes the title search will turn up some "cloud on the title"
which reveals something is wrong, such as a break in the chain of title, inaccurate
property description in a previous deed or some old secured loan which has not been
released. Such clouds can be a reason to cancel a contract for purchase of the real
property.
See also chain of title encumbrance escrow lien title title insurance
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